The Ministry of Finance has warned Ministries, Departments and Agencies (MDAs) against granting of tax incentives to investors, contractors and other stakeholders without the consent of the Finance Minister.
In a reminder, the Ministry of Finance noted that it is only Parliament, with the advice of the Minister for Finance, that can grant tax incentives, including tax exemptions and waivers.
“Any MDA that seeks to make a provision for tax exemptions/incentives in a contract, loan or international agreement should apply to the Minister for Finance for consideration”.
Ministry of Finance
The recent warning comes at a time when the Auditor General’s Report has uncovered massive breach of procurement laws in most of the state institutions.
Disregard for proper procedures continue to cause the government huge losses. This is more so, in cases where such contracts awarded without proper procedures result in judgement debts.
Revenue mobilization at the Local Government Level
Aside the call to follow the laid-down procedures during the preparation of their Budgets, the Finance Ministry also urged local governments to improve their revenue mobilization.
In the 2022-2025 Budget Preparation Guidelines, the Finance Ministry tasked Metropolitan, Municipal and District Assemblies (MMDAs) to explore the revenue potential in property rates to enable them improve their Internally Generated Funds (IGFs).
More so, the Finance Ministry urged the MMDAs to leverage digitization to improve the mobilization of IGFs to aid the development of their local communities.
“To this end, MMDAs must ensure that properties in at least major towns are valued and employ the use of technology in the mobilization of revenue from property rates”.
Ministry of Finance
Consequently, the Finance Ministry instructed MMDAs to make adequate budgetary allocation for property valuation and revaluation in their budget.
The Ministry noted that this will ensure systematic valuation of all properties in line with government’s policy to enhance property rate collection and administration.
This is where the Lands Valuation Division (LVD) of the Lands Commission (LC) will be very instrumental.
To this end, the Ministry of Finance stated that MMDAs should contact the LVD of the LC for the valuation of the properties through the Ministry of Local Government, Decentralization and Rural Development.
Still on mobilization of IGFs, the ministry advised MMDAs to follow the Fee-Fixing Guidelines under Section 150 of the Local Governance Act 2016, Act 936, to prepare their internally generated revenue budget estimates.
Revenue Improvement Action Plan
Further MMDAs are to review the Revenue Improvement Action Plan (RIAP) and make appropriate budgetary allocation for the implementation of the revised strategies to improve IGF mobilization.
In addition, MMDAs are expected to invest part of the IGF into data collection and management. More importantly, they are to commit and use at least 20 percent of the IGF to initiate and or complete Capital Projects for the direct benefit of the citizenry.
“RCCs and MMDAs are to prioritize all on-going and completed projects including those for which full payment have not been made. MMDAs are to note that, new projects can be included in the budget only when there are additional resources. MMDAs are to invest part of their resources in income generating activities to expand their local economy”.
Ministry of Finance
Development Partner Fund
Moreover, the Ministry of Finance urged MMDAs to ensure that expected DP support are captured in the budget to facilitate implementation of programmed activities. This, according to the Ministry, should include both direct and indirect interventions to the Assembly.
Additionally, MMDAs are to produce a list of all revenue collectors categorized into those paid by the Assembly (IGF) and those on central government payroll together with their salaries.
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